Your Survival Guy

Preparing your investments and family for when disaster strikes.

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Do You Know Dick Young’s Investment North Star?

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As more money piles into stocks, there’s never been a better time to get acquainted with Dick Young’s investment North Star, the Treasury bill. Backed by the full-faith credit pledge of the United States government, the T-bill is your risk-free rate of return. See the chart below, and roll your finger, left to right, from the mid-80s to today. Do you see a problem with today’s investment environment? It’s a lot different from when Dick Young began writing to you, as I explain when you click on the chart link above.  … [Read more...]

Right Now: Power Outages Rivaling Superstorm Sandy

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“Storm Leaves its Mark,” reported the Newport Daily News on Tuesday morning, as damage continued to be assessed from a storm system that hit the region late Sunday and early Monday, packing hurricane-force gusts. Hundreds of thousands of residents across New England were without power. In the Rhode Island region, 26 percent of customers lost power. Many are still without. “The number of outages we have are rivaling the number we had in superstorm Sandy,” said National Grid spokesman Tim Rondeau of National Grid. “Power May be out for Days in Northeast,” read another headline reported … [Read more...]

Preparing Yourself for the Next Disaster: Tailgating at the Patriots

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Preparing yourself for the next disaster gives you a certain mindset. You’re always trying to absorb as much information as possible from all of life’s experiences. And they all don’t have to be gloom and doom. Take tailgating at a New England Patriots game for example. The parking lot before a game can be surprisingly educational from a disaster prep standpoint. Any successful tailgating involves prep days before the actual game. Saturday afternoon, for example, I was at Staples picking up a storage bin for cups, paper towels, and other stuff I didn’t want to slide around in the back of … [Read more...]

The Truth Behind the S&P 500, Part II

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The S&P 500 is perhaps the largest “managed” fund in the world. Contrary to widespread belief, it is not an index of only the largest companies in America by market-cap as I explain here. It is an index comprising 500 stocks that are actively chosen by a committee. The committee, led by economist David Blitzer picks 500 stocks from a listing of 1,000 of the largest companies in America. It also decides the sectors and the sector-weightings. In the late 90s, for example, when technology was on fire, the committee finally decided to make technology its own sector. The committee had … [Read more...]

Everyone is Missing This Detail in the Tax Plan

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While the Tax Policy Center and anyone with an ax to grind is out hammering the GOP and the President for giving the wealthy a bigger tax cut than the middle class, Chris Edwards says otherwise. Edwards, a friend of mine and director of tax policy studies at the Cato Institute, dials in on the tax plan, noting that while the wealthy are getting the largest average reduction in tax dollars paid to the government in the plan, as a percentage of taxes currently being paid, the Middle Class is getting the biggest cuts. He writes: The TPC summary says, “Those with the very highest incomes would … [Read more...]

The Truth Behind the S&P 500

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Let’s get a few things straight about the S&P 500. First, it’s a market-cap weighted index of large-cap companies based in the U.S. A company’s market cap is calculated by multiplying its shares outstanding by its stock price. The bigger the company’s market-cap the bigger its influence on the direction of the S&P 500. Imagine Apple or Amazon as the 800-pound gorillas and you get an idea of how the index works. How is it constructed? The S&P 500 is not a collection of the largest 500 companies by market cap in the U.S. It is constructed and managed by a committee. Part of the … [Read more...]

U.S. Navy Unleashes Its Most Advanced Nuclear Attack Submarine

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The U.S. Navy’s newest and most advanced nuclear attack submarine was christened in a ceremony in Groton, CT on October 14th, 2017. The USS South Dakota, a Block III Virginia-Class attack submarine was engineered with the most advanced undersea technical innovations. Kris Osborn from the Scout Warrior discusses some of these new technologies that are integrated into the USS South Dakota. Many of these innovations, which have been underway and tested as prototypes for many years, are now operational as the USS South Dakota enters service; service technology developers have, in a general way, … [Read more...]

Paris: A Checklist before You Leave

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Take it from me, there’s a lot that can be forgotten before you leave on your trip to Paris. For example, if you use a debit card, you don’t want to forget to call your bank or credit card company to let them know you’re going to be out of the country. If you’re used to using American Express, realize it’s not accepted by some merchants and brasseries. It was embarrassing when our waiter told me, after our first meal, that my credit card was rejected. This was especially embarrassing since my father-in-law, Dick Young, asked me with a grin, “Aren’t you the survival guy?” With that in … [Read more...]

My Pick for the Next Federal Reserve Chief: A Gold Standard

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If the decision were up to me to choose between current Federal Reserve governor Jerome Powell or Stanford University economics professor John Taylor as the next Federal Reserve Chief, I would choose Taylor. At least, of the two, Taylor has a rule named after him. According to the “Taylor Rule,” the Federal Funds rate would be a much higher 3.5% today, not a measly 1%.  But the rule isn’t exactly cut and dried. “Its components include the gap between inflation and its target, between economic output and its target, and the ‘neutral’ real (inflation-adjusted) interest rate, which keeps the … [Read more...]

This Market is Smoking-Hot

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Over the weekend I received a post-card sized mailer from a local realtor. She was reaching out to residents in my general neighborhood. She has a retired couple interested in buying in the “neighborhood.” Her “clients” want off street parking, an easy to maintain yard, located within walking distance to the center of Newport. Whether this couple exists is neither here nor there. The real estate market, as she points out, is smoking hot and if you’re thinking about selling she wants to hear from you. Pretty clever approach for stressed out buyers or realtors. Which leads me to an article … [Read more...]